Hyundai Motor still mulling over plan for diesel engine factory in India

The Indian unit of Hyundai Motor Co. said it is still studying a plan on whether to construct a diesel engine factory due to the unclear government policies. Hyundai, the second-ranked carmaker in India by sales volume, sells diesel cars such as the i20 hatchback, Verna and Sonata sedans and the Santa Fe sports-utility vehicle (SUV). The Elantra sedan will soon be offered with options of a 1.6-liter diesel engine and a 1.8-liter gasoline engine. The cheapest model will cost Rs1.25 million (US$22,563) and the top-end will cost Rs1.59 million (US$29,000). Hyundai is examining growing sales of SUVs and multi-purpose vehicles in India, but would not say whether or not it has any plans to introduce new vehicles in these segments. The plan to build the diesel-engine plant is still under study for national sales at Hyundai Motor India Ltd. Sales of diesel vehicles are growing fast, but the carmaker says it is waiting for some consistency in diesel and gasoline fuel pricing. Hyundai currently imports diesel engines. The price of diesel fuel is controlled by the federal government and it is considered a politically sensitive issue. The price of gasoline has been decontrolled in June 2010; for that reason a liter of diesel fuel costs about 40% less than gasoline in New Delhi. (August 13, 2012)